Decided on April 17,2015

Aditya Laminators Pvt. Ltd. And Ors. Appellant
Commissioners Of Central Excise, Customs And Service Tax Respondents


P.K. Das, Member (J) - (1.)THE relevant facts of the case, in brief, are that the Appellant No. 1 was engaged in the manufacture of Plastic Bags and Pouches falling under Chapter 39 of the Central Excise Tariff Act 1985. They were availing cenvat credit benefit under the cenvat Credit Rules. On 7.2.2004 a team of Central Excise Officers of Daman Commissionerate visited the appellants factory and withdrew input invoices available in the factory for further verification/investigation. The said officers recorded the statements of Appellant 2 and 3, the Managing Director and the Authorized Signatory of the appellant company. A show cause notice dtd. 14.12.2004 was issued proposing to deny the cenvat credit of Rs. 44,10,384.00 wrongly taken alongwith interest and to impose penalty during the period from 3.1.2000 to 25.10.2003. It has also proposed demand of differential duty of Rs. 14,266/ - alongwith interest and penalty on clearance of 4953.400 kgs. of plastic scrap/waste as undervalued. It has proposed imposition of penalty on Shri Vivek C. Vaidya, Managing Director of the appellant company and Shri Yogesh N. Desai, Manager/Authorized Signatory of the appellant company under Rule 209 A of the erstwhile Central Excise Rule 1944 and presently Rule 26 of the Central Excise Rule 2002. It has been alleged that the appellant company have wrongly taken cenvat credit on the basis of bogus invoices issued by non -existence firms and made false entries.
(2.)THE adjudicating authority confirmed demand of cenvat credit of Rs. 44,10,384/ - alongwith interest under erstwhile Rules 57I of the Central Excise Rule 1944, Rule 12 of Cenvat Credit Rule 2001 and 2002 and Rule 14 of the Cenvat Credit Rules, 2004 read with provisions of proviso to sub -section (1) of Section 11A of the Central Excise Act 1944. It has also confirmed the demand of Central Excise duty of Rs. 14,266/ - alongwith interest. It has also imposed penalty of equal amount of duty on Appellant No. 1 company. Penalty of Rs. 5,00,000/ - and Rs. 1,00,000/ - were imposed on Shri Vivek C Vaidya, Managing Director and Shri Yogesh N Desai, Manager/Authorized Signatory respectively of the appellant company, Appellant No. 2 and 3 herein. By the impugned order, the Commissioner (Appeals) rejected the appeals filed by the appellants. Hence, the appellants filed these appeals before the Tribunal. The appellants also filed applications for incorporation of additional grounds of appeal. They further filed applications for extension of the stay order.
Learned Advocate appearing on behalf of the appellants submits that the demand of duty is barred by limitation. He submits that the appellant availed cenvat credit on the basis of the invoices issued by the registered manufacturer/dealer and duly recorded in the cenvat account. It is evident from the record that the inputs were used in the manufacture of final product and cleared on payment of duty. It is contended that at the initial stage, the Superintendent of Central Excise verified and allowed Modvat credit and duly endorsed in the invoices. The Learned Advocate drew the attention of the Bench to the relevant invoices. He further submits that the appellant acted on bona fide manner. There is no material available of alleged irregularity on the part of the appellant and the extended period of limitation cannot be invoked. He strongly relied upon the decision of the Hon'ble High Court of Gujarat in the case of Prayagraj Dyeing and Printing Mills Pvt. Ltd. vs. Union of India : 2013 (290) ELT 61 (Guj.) which was followed by the Hon'ble High Court of Gujarat in the case of Poddar Exports (India) Proprietary Firm Shri Pradeep vs. Union of India . He also relied upon the decision of the Tribunal in the case of Akik Dyechem Pvt. Ltd. vs. Commissioner of Central Excise, Ahmedabad 2013 (290) ELT. 273 (Tri. Ahmd).

(3.)HE submits that the credit cannot be denied on the basis of simple report of the Central Excise Officers, as the jurisdictional Superintendent already verified the invoices. He relied upon the decision of the Tribunal in the case of Suraj Lamps and Industries Pvt. Ltd. vs. Commissioner of Central Excise, Delhi IV - 2004 (178) ELT. 967 (Tri. Del.) He also submits that the Misc. application filed by them on additional grounds in so far as the demand of duty under Rule 571 of the erstwhile Rules is liable to be set aside as the said Rule was not in existence at the time of issue of show cause notice. He also contested the demand of duty of Rs. 14,266.00 in merit and imposition of penalty.

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